To buy or not to buy??

[klconley]

My husband and I bought 308,000 points through ebay for $1900. We are staying at Wyndham Sedona right now and have gone through the "update" sales presentation. This is what they are offering (we have not bought yet):

They want to upgrade us to VIP by selling us 308,000 points. They are offering $16,000 for 154,000 points plus a developer resale property (154,000 points) for $5000. So in all they are offering 308,000 points for approx. 21,000 dollars which is good.

What they are contending is that we can rent out 308,000 points throughout the year and after 7 years we can pay off our purchase and continue to pay our maint. fees.

Our questions are all follows.

Is the market ripe for renting in Flagstaff AZ, Arkansas, and Branson Missouri, which is where all three deeds are?

What do you think about the viability of earning $3000 in rental fees by renting out 308,000 points per year?

 

[timeos2]

DO NOT buy Wyndham at retail pricing or you will regret it

Our questions are all follows.

Is the market ripe for renting in Flagstaff AZ, Arkansas, and Branson Missouri, which is where all three deeds are?

No. The market for rentals everywhere has tanked.

What do you think about the viability of earning $3000 in rental fees by renting out 308,000 points per year?

None. Zero. And the minute you purchased those retail points at $16000 and let the rescind period expire they are worth - as you already know - around $2000-3000 tops. Why would you even entertain such a thought? If you want 308,000 more points go buy them resale. There is no way you'd ever get $12,000 + value out of VIP.

Think. Then walk away. Oh, and remember to complain about the recent prohibition on owner to owner rentals. Tell them you will NEVER consider a retail purchase if that rule stands as proposed starting in March.

 

[bnoble]

So in all they are offering 308,000 points for approx. 21,000 dollars which is good.

$19,000 more than you paid for your first 308K is "good"? Really?

Doesn't sound good to me.

$3,000 per 308K is almost $10/K. A little more, after you subtract costs, so lets just call it $10/K. It's a pretty rare reservation that can fetch $10/K---sounds far-fetched to me.

Finally, the lost opportunity on your $21,000 (at 8%, the figure I use) is $1,680. So, even if you do net $3,000, less than half of that is going to principal.

Sounds like a lot of work and a big capital outlay for the very minimal benefits of "regular" VIP---which are likely to change (for the worse) anyway.

If you want to try to be a landlord, just buy another 308K resale, and try it. Use the money you save to pay for the extra guest certificates and transaction fees---about $200-$300 per year, much less than that extra $19K.

 

[lprstn]

NO! not good at all! Walk away...

 

[klconley]

Thanks

We are not going to buy!! Kelly

 

[bnoble]

Good 'cause there was an error in my math. Even if you rent at $10/K, you're only treading water, not paying off the principal.

My lost opportunity number is 8%. They are charging you $68/K. Opportunity on that is $5.44. But, your MFs are probably close to $5/K. So, even if you rent for $10/K, you *lose* $0.44/K on lost opportunity. So, you are not reducing your principal at all.